Italy

Doing Business in Italy

Introduction

Italy has recently taken new steps to position itself as a welcoming home for foreign investment. The result is that Italy is emerging as a land of opportunity, although you will need specialist local advice to help navigate your way through the bureaucracy in order to start a business in Italy. We are experts at this. If you are considering company incorporation in Italy, please contact us for further details.

Company Information

What are the main types of company formation in Italy?

There are three major kinds of Italian company registration for foreign investors, and they are as follows:

  1. Limited Liability Company (SrL)
  2. Joint Stock Company (SpA)
  3. Branches

What are the main features of a SrL?

  • Most popular format for small to medium businesses
  • Minimum share capital is €10,000
  • No restrictions on foreign shareholders
  • Audited accounts to be filed annually

What is the minimum number of directors of a SrL?

It is best to have a minimum of two. In fact it is possible to set up a SrL with just one director, but in such cases the company has to have words ‘Società Uninominale’ in its title, otherwise liability is unlimited.

What are the main features of a SpA Joint Stock Company?

  • Main format for medium to large companies
  • Minimum share capital is €120,000
  • Minimum number of directors is one
  • No restrictions on foreign shareholders
  • Audited accounts to be filed with the Registrar of Companies

What are the main features of a Branch?

  • Foreign parent responsible for all liabilities of Italian branch
  • Minimum of one director required
  • Accounts to be maintained but no reporting requirements

Is it complicated to start a business in Italy?

It is more complicated to start a business in Italy than in some other European countries, but like anything else, it is a matter of mastering the procedure. The company incorporation Italy formalities include the following:

  • Arrange articles of association and memorandum of association
  • Executive articles of association before a public notary
  • Obtain an Italian tax code and identity document
  • Open a local bank account
  • Register for VAT
  • File with the Registrar of Companies
  • Secure approval by a local tribunal

How easy is it to recruit staff in Italy?

As a rule, it is easier to recruit staff in the underdeveloped south, where unemployment is high, compared to the wealthier north of the country. Recruitment agencies for permanent and temporary staff abound, however, and the workforce is generally of a high caliber. Labor laws strongly favor the employee and it is essential to take advice before entering into a contractual arrangement—we have a network of local experts who will be happy to help  our clients on this point if they are considering company formation Italy.

What is the regulatory environment like for those considering company incorporation Italy?

Capital and dividends can be freely repatriated in line with EU rules and Italy has a number of double taxation treaties. However, public authorities are weighed down with bureaucracy and the legal system is slow. Foreign ownership is permitted in all industries except for defence-related areas such as aviation and shipping. Certain restrictions apply in the telecommunications sector.

What are the available banking facilities?

Italy offers a variety of incentives for foreign and local investors considering company formation Italy. These include:

  • Corporation and local tax breaks for ten years in areas of high unemployment
  • Research and development grants covering up to 50% of total R&D costs
  • Low-interest loans for enterprises that encourage exports of Italian goods

And what about banking facilities?

Milan is one of Europe’s foremost financial capitals, and banking facilities across Italy are generally good. Efforts are underway to rationalise the many hundreds of independent local banks, and facilities are expected to improve further once this process is complete. We will be happy to help our clients to open a bank account in Italy.

Disclaimer
Whilst every effort has been made to ensure that the details contained herein are correct and up-to-date, it does not constitute legal or other professional advice. IQTESADI does not accept any responsibility, legal or otherwise, for any errors or omission.